Thursday, October 1, 2009

The Invite

Since Internet-based products and services are much more scalable than actual real-world products and services there is usually very little natural scarcity on the supply-side of these digital goods - i.e. a website can be read almost infinitely while nearly no additional resource is consumed.

Although this makes sharing wonderfully simple, it also prevents brands from creating the "long-line effect" - i.e. from showing how wonderful their product is through the long lines of people waiting to buy. So to overcome this temporary side-effect, many companies are now utilizing the invite. After initially launching an Internet-based product or service, these companies distribute only a select number of invites.

This creates both an artificial scarcity and a collective buzz. The most important characteristic of the invite is timing - using it for too short and there is no "long-line effect"; using it for too long and potential consumers will become frustrated and might never come back. Although the usage of the invite can potentially reap benefits, it is still more of an artform than a science.
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